[ID] => 10214
[post_author] => 5714
[post_date] => 2018-10-16 11:48:39
[post_date_gmt] => 2018-10-16 10:48:39
[post_content] => Univar, one of the leading global chemical distributors, has entered into a definitive agreement to acquire Nexeo Solutions in the form of a cash and stock transaction valued at approximately $2.0bn. The transaction has been unanimously approved by the boards of directors of both companies and is anticipated to close in the first half of 2019.
"This transformational combination is designed to create the premier global chemical and ingredients distributor, with exciting opportunities for our customers, suppliers, employees and investors,” says David Jukes, CEO of Univar. “Together, we will drive growth and shareholder value with the largest North American sales force in chemical and ingredients distribution, the broadest product offering, and most efficient supply chain network in the industry. We expect the transaction to be accretive to earnings and cash flow beginning in the first full year post closing and to generate $100m of annual run rate cost savings by the third year following close and reduce annual capital expenditures by $15m immediately."
The merger agreement provides for each share of Nexeo stock issued and outstanding to be converted into 0.305 shares of Univar common stock and $3.29 in cash, subject to adjustment at closing, representing a purchase price of $11.65 per share of Nexeo common stock. The cash consideration is subject to a potential reduction of up to $0.41 per share, based on Univar’s stock trading price prior to the completion of the acquisition. The transaction is expected to deliver $100m, or approximately $0.43 per share after tax.
"By combining the best capabilities, talent, and resources from our two companies we will be even better equipped to deliver superior service and expanded value to our customers and supplier partners,” continues Jukes. “We expect to leverage Univar's leading e-commerce and digital capabilities across Nexeo's financial systems and centralised ERP platform. By doing so, we aim to accelerate the digital transformation already underway at Univar and reduce costs, while enhancing the ease of doing business. Our shared commitment to safety and innovation and our common organisation structures provide a strong foundation for a smooth and successful integration."
David Bradley, CEO of Nexeo adds: "We share Univar's confidence in the future of our combined enterprise, given the strong strategic alignment across our business models, go-to market strategies, superior product offerings, and digital capabilities. This combination represents a logical and compelling step forward, consistent with our focus on accelerating growth for the benefit of our customers, employees and suppliers. We are especially pleased that Nexeo's employees are highly valued by Univar, and that our shareholders will be able to participate in the company's future success through ongoing equity ownership."
Consistent with its focus on chemicals and ingredients distribution, Univar has hired an external advisor to evaluate strategic alternatives for Nexeo's industry-leading plastics business, which may include a potential divestiture. Nexeo's plastics business is a distributor of prime thermoplastic resins and other products supporting OEMs, moulders and design firms around the world, and will represent less than 10 per cent of the combined company’s earnings. The business will continue to be led by Shawn Williams, executive vice-president of Nexeo Plastics. The review is expected to be completed concurrent with the close of the transaction.
[post_title] => Univar: Chemical transformation
[post_status] => publish
[comment_status] => open
[ping_status] => open
[post_name] => univar-chemical-transformation
[post_modified] => 2018-10-15 17:50:50
[post_modified_gmt] => 2018-10-15 16:50:50
[post_parent] => 0
[guid] => https://www.hcblive.com/?p=10214
[menu_order] => 0
[post_type] => post
[comment_count] => 0
[filter] => raw
Univar: Chemical transformation
Univar's planned acquisition of Nexeo Solutions will create a global giant in chemicals and ingredients, topping off a year of consolidation